Although there are exceptions, lenders generally do not “pre-approve” borrowers to conduct a short sale. In our case we have figured out the best way to conduct short sales. We have investors that are willing to buy these properties, Therefore they will put an offer in on the property right away. This allows us to get negotiations with the bank started and to shave valuable time off of the process to make things much quicker. With our help as your real estate agent, you negotiate a sales contract with the buyer. We will present the contract as part of a short-sale package for your lender’s consideration. In many cases, your lender will then communicate with you and with us, because we represent your interests in the short-sale transaction, about the disposition of your short sale.
1. Finding the right buyer.
A critical element to the success of your short sale is finding a buyer who has the patience to go through the process.
Bear in mind, a short sale can take weeks — even months — longer to accomplish than a traditional home sale. In addition, it’s not uncommon for attempts to secure lender approval on a short-sale to fail for one reason or another — the seller failed to prove a hardship situation, other parties with claims on the property could not be satisfied, the seller’s lender didn’t like the contract with the buyer, etc.
We employ all of our professional negotiating skills, knowledge, long standing relationships and networks not only to find a buyer who is willing and able to purchase your property, but to negotiate a sales contract with the buyer that is likely to win your lender’s approval for a short sale. (For example, some lenders will not accept a buyer’s offer if the sale price is less than 90% of market value or nets 85% after all closing costs are deducted.) Just as important, we educate your buyer and his or her real estate agent about the short-sale process, keeping them interested and informed as the process moves forward.
2. Presenting your short-sale package with a proposal to your lender.
Does a short-sale request have to be presented by a real estate agent? Perhaps not in every case, but lenders much prefer to work with professional real estate agents on short-sale transactions. In fact, if you hope to get the attention and cooperation of your lender, it is essential you work with a real estate agent who has experience working with short sales, who knows all the ins and outs of working with lenders and who is committed to your short-sale success. That’s where our expertise is invaluable to our sellers.
A short-sale package typically contains these documents, among others: authorization letter to negotiate on your behalf, signed sales contract, broker price opinion(s), preliminary HUD-1 settlement sheet, hardship letter, 2 months of bank statements (W2, 1099, tax return, etc.), budget worksheet, photos of home (interior, exterior), repair estimates, latest comparables, local market statistics, and other documents relating to current market value of your home.
We have the knowledge and experience to determine upfront whether your situation would likely qualify you for a lender-approved short sale. We understand what lenders are looking for in a short-sale request, and we make sure our clients provide all the information and documentation needed to start the process efficiently and effectively.
3. Staying on top of the process from start to finish.
The fact is lenders are currently swamped with requests for loan workouts and short-sale proposals. Many lenders are understaffed and/or operating with newly trained personnel who each may be expected to handle hundreds of cases at a time. In this environment, even a small oversight or glitch in the process could cause your short-sale request to end up in the reject pile or on the back burner.